Nexo Seeks $3B in Damages from Bulgaria Over Aborted Investigation Affecting US Stock Listing

cryptonews.com:

Crypto lender Nexo has started a legal battle seeking $3 billion in damages from Bulgaria following an aborted criminal investigation that the company claims derailed its plans for a US stock market listing and a soccer sponsorship deal.

Nexo AG, a Swiss subsidiary of Nexo Capital based in the Cayman Islands, alleges that the investigation severely damaged its reputation and resulted in a significant loss of shareholder value, Reuters reported Wednesday. 

The case has been registered with the International Centre for Settlement of Investment Disputes (ICSID), a Washington-based international arbitration institution that handles disputes between global investors and states.

While the ICSID has acknowledged the registration of the case, specific details regarding the requested damages or other aspects have not been confirmed by an ICSID spokesperson.

The Bulgarian Ministry of Finance confirmed receiving the arbitration request from the ICSID, stating that it would be reviewed by an inter-departmental committee specializing in such matters, which would propose the subsequent steps.

However, the ministry emphasized that the receipt of the request should not be considered an admission of the claims or an acceptance of the arbitral jurisdiction.

The Bulgarian prosecutor’s office, also named as a respondent in the case, has not yet responded to requests for comment.

In January 2023, Bulgarian prosecutors initiated an investigation into Nexo AG, conducting raids in Sofia and charging the company’s founders with various offenses, including participation in an organized crime group to commit money laundering, tax fraud, and computer fraud. The crackdown led to mass fund withdrawals from the platform.

Nexo, which was raided earlier this